Beijing grants Tencent its first license in over a year

China has granted the industry heavyweight a new video game license for the first time in a year and a half Tencent, hitherto shunned in a context of recovery aimed at tech. Video games, which represent an important financial windfall in China, have been in the crosshairs of the authorities since last year for their addictive side among the youngest.

Last year, Beijing froze for nine months any new license, a mandatory sesame to market a game on the world’s largest market. China resumed licensing in April. But Tencent had not obtained any major so far, which had weakened the world number one.

70 new games have been licensed

On Thursday, 70 new games got the green light for marketing, including one for Tencent (“Metal Slug: Awakening“), indicated the administration of the press and the publications. The last major license granted to Tencent was in May 2021.

In September, a subsidiary of the group had obtained one but it only related to an educational game and not monetizable. Its competitor NetEase meanwhile won a new license on Thursday, after a first already in September. These decisions initially sent a positive signal to the markets on Friday, seeing it as a relaxation of the authorities on a very lucrative sector. But investors are still on their guard.

Tencent shares thus took more than 2% in the morning on the Hong Kong Stock Exchange, before closing down nearly 1.5%. That of NetEase meanwhile ended up nearly 4%, after a jump of more than 7% in the morning. The takeover of Beijing was notably marked by drastic restrictions imposed on players under the age of 18.

Their online gaming time is now limited to three hours per week, which weighs heavily on the profitability of companies in the sector.

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